Suppose the marginal product of the last worker employed by a firm is 40 units of output per day and the daily wage the firm must pay is K20, while the marginal product of the last machine rented by the firm is 120 units of output per day and the daily rental price of the machine is K30. Is the firm maximizing output in the long run? If not what should be done?

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Short-Run Costs and Long-Run Costs

Cost of short-run and the long-run is an economic term that describes the cost involved in the production of goods in a firm in the short as well as long period.